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Pakistan Achieves First Current Account Surplus in 14 Years, Says Finance Minister
Pakistan posts first current account surplus in 14 years, boosts tax collection, lowers inflation, and stabilises FX reserves, says Finance Minister Bilal Azhar Kayani.
ND
by News Desk
2025-10-27
Pakistan Achieves First Current Account Surplus in 14 Years, Says Finance Minister

Islamabad | October 27, 2025 — Pakistan’s economy has shown significant improvements over the last 1.5 years, with the country achieving its first current account surplus in 14 years and the largest surplus in 22 years, according to Minister of State for Finance Bilal Azhar Kayani.

During a media briefing in Islamabad on Monday, Kayani attributed the gains to government policies, fiscal discipline, and reforms, highlighting the achievement of the primary balance target despite no mini-budget last year.

“We saw a 26% increase in tax collection in the last fiscal year, even amid modest GDP growth and low inflation. The FBR’s tax-to-GDP ratio rose from 8.8% to around 10.2-10.3%, while inflation fell from 33% to 4.5%,” Kayani said.

He explained that stabilising the current account and strengthening foreign exchange reserves were crucial to macroeconomic stability. The policy rate was halved from 22% to 11% due to controlled inflation, he noted.

Kayani also highlighted progress in privatisation initiatives, including the sale of First Women Bank Ltd (FWBL) to Abu Dhabi’s International Holding Company and ongoing efforts to privatise Pakistan International Airlines (PIA).

“Prime Minister Shehbaz Sharif believes Pakistan needs private sector-led growth, with the government focusing on policy-making and facilitation,” Kayani added.

Pakistan’s economy had faced a prolonged crisis in recent years, including critically low foreign exchange reserves and a looming risk of default in 2023. Support from the IMF, China, UAE, and Saudi Arabia, combined with tough fiscal reforms, helped stabilise the economy.

This year, global rating agencies Fitch, Moody’s, and S&P have all upgraded Pakistan’s sovereign credit rating, reflecting improved economic fundamentals.

Finance Minister Muhammad Aurangzeb also said last week that Pakistan could achieve GDP growth of around 3.5% this fiscal year despite recent floods, and foreign exchange reserves currently cover approximately two and a half months of imports, projected to rise to three months.

Additionally, Pakistan recently repaid a $500 million Eurobond on schedule, demonstrating stronger fiscal discipline, improved reserves, and a more sustainable debt profile.
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